* U.S. stocks mostly higher, MSCI world equity index up
* U.S. ADP jobs report helps sentiment, oil firmer
* Yen jumps on Bank of America concerns, as does gold
(Updates with U.S. market activity, changes dateline,
previous LONDON)
NEW YORK, May 6 (Reuters) - U.S. stock and crude oil
markets rallied on Wednesday as a U.S. report indicating
private sector job losses in April were slowing gave investors
another sign the worst of the recession may be past.
The gains in U.S. major stock indexes mirrored advances
elsewhere in the world with the benchmark MSCI world equity
index <.MIWD00000PUS> staying close to a 4-month high, helped
by better-than-expected results from BNP Paribas and euro zone
data showing firmer services business activity.
The low-yielding yen, which typically strengthens when
investors wish to avoid risk, jumped after a source familiar
with the result of a U.S. banking stress test told Reuters Bank
of America <BAC.N> needed as much as $34 billion in extra
capital.
The results of the stress tests are due on Thursday.
Concerns about banks linger but the effect was seen more in
the currency and gold markets than in the shares themselves as
investors who were concerned rotated into other asset classes.
"The results that are coming tomorrow are priced in," said
John Schloegel, vice president of investment strategies for
Capital Cities Asset Management in Austin, Texas of the stress
tests. "There must be enough tiers of preferred stock they can
convert to equity, and perhaps they don't necessarily need to
tap external sources for capital."
The Dow Jones industrial average <> rose 23.82 points,
or 0.3 percent, to 8,434.47. The Standard & Poor's 500 Index
<.SPX> gained 4.78 points, or 0.5 percent, to 908.58. The
Nasdaq Composite Index <> fell 10.12 points, or 0.6
percent, to 1,744.00 with investors believing recent gains in
the technology heavy index had gone too far, too fast.
Bank of America <BAC.N> rose 8 percent. Shares in
Citigroup, which may need as much as $10 billion according to a
person familiar with the matter, rose 4.8 percent.
Walt Disney Co <DIS.N> was the Dow's biggest lift, up 10.5
with the No. 1 U.S. entertainment company posting a quarterly
profit above Wall Street's forecasts on Tuesday.
ADP GOOD NEWS
The solid jobs data impacted several asset classes.
[].
U.S. Treasury debt prices fell on the data, with the price
on benchmark 10-year Treasury notes <US10YT=RR> down 3/32 at
96-14/32. Their yield, which moves inversely to their price,
was 3.18 percent, up from 3.16 percent late on Tuesday.
In other regional share markets, the FTSEurofirst 300 index
<> rose 1.3 percent on the day while emerging stocks
<.MSCIEF> also climbed 1.3 percent.
The dollar fell 0.3 percent against the yen to 98.58 yen
<JPY=> while the euro fell 0.1 percent to $1.3293 <EUR=>.
Concern about U.S. banks and uncertainty about a European
Central Bank policy meeting did dull some risk appetite and
boost safe haven flows into the greenback.
New York gold futures rose for a third straight day on
Wednesday as stress tests on U.S. banks underscored lingering
economic uncertainties, bolstering safe-haven demand in the
bullion market. [].
Gold for June delivery <GCM9> was up $3.4 at $907.70 on the
COMEX division of the New York Mercantile Exchange.
Oil investors however, focused on the positive economic
news, with U.S. June crude futures <CLc1> rising $1.86 cents to
$55.70 a barrel on the New York Mercantile Exchange as
government inventory showed data showed gasoline stocks fell
last month, adding to hopes of an economic recovery.
(Reporting by Reuters bureaux worldwide, writing by Nick
Olivari in New York, Editing by Chizu Nomiyama)
